The information herein is provided as a public service without warranty,|
guaranty or endorsement by the proprietors of this Web site.
This page focuses on alerting you to the ubiquitous scams, schemes and financial traps which are intended to separate you from your assets.|
The scam artist preys on certain mentalities. Are you looking for a "quick buck" -- trying to get something for nothing -- seeking extraordinary returns on your investment money? Then you are their perfect candidate.
"Making a mistake once is painful, but there has to be room for failure, or no one will take chances. At the same time, it's critical not to make the same mistake twice."|
"Well, as through the world I've rambled, I've seen lots of funny men. Some rob you with a six-gun, some with a fountain pen"|
From the song "Pretty Boy Floyd" by Woody Guthrie
"Let's face it! The reason we all invested with FIBG was that we
wanted a better lifestyle. Whether it be for retirement or so Mom
could stay home with the kids. We all took a chance on this thing.
Looking back hindsight being 20/20 it now seems unrealistic that we
could receive returns like the ones that were promised."|
Posted after the failure of a Grenada bank.
"'Prime bank trading' instruments do not exist except as a means for scam dogs to commit fraud and steal funds." [Attribution: www.goldhaven.com]
"There is no such thing as a high yield investment program. They do not
exist, no matter how much you want to believe they do. People who fall for these schemes almost deserve to lose their money because they are inherently lazy and greedy. The thought of working hard to make money so repulses them that they chuck their money at the first con man who comes along promising to make them wealthy. I can assure you that, after conning you, the scam artists get together in bars and restaurants and have a jolly, good laugh at your expense. It is all rather sad."|
David Marchant, Editor, Offshore Business, www.offshorebusiness.com
Here is a list of avenues which are considered dangerous for you to pursue:
- 60-40 program, "a pyramid scheme"
- Advance Fee Scams
- Advanced letters of credit
- Alias passport extortion scams
- Bank Debenture Trading Scams
- Blocked funds
- Charitable FLP plans
- Church charter fad
- Common Law Business Organizations
- Constitutional Trusts
- Contractual Business Organization
- Corporation sole
- Defective Trusts
- Dominion of Melchizedek
- E65 Endowment scam
- Ecclesiastical corporation
- Employee leasing company programs structured offshore
- EnenKio gold bonds
- Family tax savings trust
- GIFT program
- Given In Freedom Trust
- Global Prosperity Group
- Hammersmith Trust
- High yield (unrealistic) returns on investments
- IBC 10
- Income deferment
- Income reductions through so called personal employment contracts
- International Depositor Insurance Corporation
- Kingdom of Enen Kio
- Kings Trust EnenKio gold bonds
- Latvian banks
- Le Club Prive
- Life Club
- Luxor Capital Markets
- The "New Utopia" tax haven investment
- The Nigerian Fraud
- Note trading
- Offers to create a new credit profile
- The Omega Program (Omega Trust & Trading)
- Passport Swindle
- Personally Owned Offshore Banks in Obscure Tax Havens
- Prime Bank Guarantees
- 'prime bank note', 'bank debenture,' 'medium term note (MTN),' or
letter of credit'
- Principality of New Utopia
- Profit diversion schemes
- Prosper International League Limited (abbreviated as P.I.L.L.)
- Pure Trusts
- Self-liquidating loans
- SG Player
- Spoofing the stock market (see the Lexicon)
- Springing cash value products
- Stock Generation program
- Strategies that rest upon resignation by a U.S. person after problems arise
- Tax Protest Schemes
- Virtual Beneficiary Trust
|A message from The Global Group Ltd.|
We don't contend that
"all of the offshore concepts are scams."
The scams arise from how the concepts are implemented and the claims that the promoters make regarding the benefits that are available with various structures and concepts. There are entirely legal concepts and structures that can be used to have access to investments not available in the U.S., to protect assets from the U.S. litigation system and to do business on
an international scale. To a limited extent, there are some offshore concepts that also offer tax deferral or tax exemption.
The Offshore Journal (firstname.lastname@example.org) is a news digest of what's happening in
the offshore community, which includes news about scams, new laws, the people in the offshore business, information resources such as web sites or other ezine publications and our views about various offshore concepts. In the coming year, I will providing a greater amount of news and views about offshore Internet commerce and e-commerce in this publication.
If you perceived our web site as having an entirely negative connotation, it's apparent that we need to review that information to make it clear that we are not opposed to doing business or investing offshore. We are just concerned that some folks may be taken in by slick claims from promoters that are not legally correct or justified.
Vern Jacobs & Arnie Cornez
You are invited to submit material for this page. Send us your contribution by e-mail and, if your submittal is appropriate and verifiable, we will post it here.
Signs of Banking-Related Investment Fraud
[SEC's Division of Enforcement]|
Below are warning signs of prime bank or other fraudulent bank-related
Excessive Guaranteed Returns
These fraudulent investment pitches typically offer or guarantee
spectacular returns of 20 to 200 percent monthly, absolutely risk free. Promises of unrealistic returns at no risk are hallmarks of prime bank fraud.
Fictitious Financial Instrument
Despite having credible-sounding names, the supposed "financial
instruments" at the heart of any prime bank scheme simply do not exist. Exercise caution if you've been asked to invest in a debt obligation of the top 100 world banks, Medium Term Bank Notes or Debentures, Standby Letters of Credit, Bank Guarantees, an offshore trading program, a roll program, bank-issued debentures, a high yield investment program, or some variation on these descriptions. Promoters frequently claim that the offered financial instrument is issued, traded, guaranteed, or endorsed by the World Bank, International Monetary Fund (IMF), Federal Reserve, Department of Treasury, International Chamber of Commerce (ICC), or an international central bank.
Promoters claim that transactions must be kept strictly confidential by
all parties, making client references unavailable. They may characterize
the transactions as the best-kept secret in the banking industry, and
assert that, if asked, bank and regulatory officials would deny knowledge of such instruments. Investors may be asked to sign nondisclosure agreements.
Promoters frequently claim that investment opportunities of this type
are by invitation only, available to only a handful of special customers, and historically reserved for the wealthy elite.
Claims of Inordinate Complexity
Investment pitches frequently are vague about who is involved in the
transaction or where the money is going. Promoters may try to explain
away this lack of specificity by stating that the financial instruments are too technical or complex for nonexperts to understand.
You should be especially watchful for prime-bank related schemes
promoted over the Internet. Despite numerous SEC actions charging prime bank promoters with multiple violations of the federal securities laws,
prime bank offerings continue to proliferate in cyberspace.
If you have any information regarding the offer or sale of "prime bank"
or similar financial instruments, or programs employing these instruments, please provide that information to the SEC's Division of Enforcement immediately by using the Enforcement Complaint Center. You also may want to visit other helpful websites to learn more about prime bank-related fraud.
The EnenKio Bond Program is suspended until further notice. Any and
all bond instruments that may be in foreign safekeeping vaults are
frozen and may not lawfully be issued, exchanged or transferred.
Certain unresolved legal questions have arisen and the EnenKio
government is cooperating with the United States Securities and
Exchange Commission to ensure that EnenKio bonds are not offered, marketed, transferred or sold to any persons or entities residing or established in the United States, including United States citizens wherever they may reside. For further information, contact United States Securities and Exchange Commission.|
Robert Moore, Minister Plenipotentiary, Kingdom of EnenKio Foreign
DO-MO-CO Manager, Remios Hermios Eleemosynary Trust, Majuro, Marshall
Beware Of The Global Prosperity Group!
This scam has already claimed over 30,000 victims. This "association" has Cease And Desist Orders in Washington, Oregon and Michigan. Virtually all other states are currently investigating this modern day SPAM & fax-blasting scam. The net is inundated with GPG SPAM. You have probably already seen their fraudulent claims of $2,000..$5,000 profit per week. Of their 30,000 members, only 3 or 4 (the pyramid's founders) have ever attained such figures. This web site has been created as a public service.
What gets you is not the "scam artist" -- it's your own greed
"I find it amazing that there are so many people out there actually
believing the garbage about "High Yield Programs" or "Bank Debenture Programs". Does anyone REALLY think that if somebody discovered how to make 100% return a month (no risk to principal, of course), they would share it with YOU! I don’t think so. However, you still have people wanting to believe that this fantasy is real. In my opinion it is not the "scam artist" that gets you, it is your own greed." www.goldhaven.com/discussion/.
FIRST INTERNATIONAL BANK OF GRANADA BULLETIN
August 17, 2000|
The Government of Grenada has appointed someone to be on the inside of the bank to monitor its activity. This should not be construed as anything other than what it is… someone to monitor activity.
IDIC is currently cooperating with various financial groups working at
sorting out the primary problem, i.e., FB’s inability to meet its
obligations to its client banks and their depositors and FB’s own direct
In the midst of this is the chaos caused by false allegations, innuendo,
threats and the daily “news” that is promulgated by those who want to see the system fail.
In a large sense, of course, the system has already failed. Failed, that
is, to meet the expectations of depositors. Unfortunately there is no excuse for the fact that these expectations were based on the aggressive marketing tactics of those involved in promoting the various banks in the system.
The question in the minds of those who still believe is, “When will the
interest payments flow again?” To those who still believe, the answer is, based on some solid information from reliable sources, “Soon.”
To those who would prefer to make threats, call everyone involved “scam
artists” (and worse) …the answer is: “It will happen when it happens.”
Progress is being made. To those who believe, we say take comfort. To those who don’t… no matter what is said… they will do what unbelievers do. One way or another, depositors will eventually get what has been promised.
Are we saying that it is wrong to complain or doubt? Of course not.
Promises have been broken, obvious mismanagement has occurred. Complaining and doubting are both understandable -- and certainly not unwarranted.
Please take the time, again, to carefully read the bulletin of August 11th below as well as the letter from the former CEO of FB and try to understand why more specific “news” is not forthcoming. For now, that is all we can pass along. We will continue to monitor the situation and update this web site with information that we feel can be reliably and safely revealed.
First International Bank of Grenada
On July 7, 2000, The Supreme Court of Grenada issued a judgment
against the infamous First International Bank of Grenada (FIBG) ordering it to pay $68,800 to five depositors, plus undisclosed amounts to other unnamed parties who were all part of the same investment group that had
deposits with FIBG.|
The depositors who are named in the order are Alfred Myers, Ronald
Lee Miller, Sheryl Clossen and thomas & Ila Jardee.
The amounts to be paid to the unnamed parties over the next 12 months
will be determined once sufficient proof of a claim is provided to the
A copy of this Order is available to the public from the Supreme
A $50 million financial guaranty was originally posted by FIBG with the
Grenada government last year as 'proof' of its financial strength. The guaranty was from International Deposit Indemnity (previously Insurance) Corporation that claims to have billions in rare stones to back it. IDIC was never license in any jurisdiction as an insurance company. No doubt, we will now all see how worthless this guaranty was.
attribution, in part: David Marchant
Anatomy of a "Such a Deal!"
Periodically, an "associates" promotion over-uses all the "buzz" words to excite and attract your money. Here is some language gleaned from a
recently announced Web site that looks like possible tax evasion, as well:|
Until now, these powerful SECRETS have been strictly kept away from the majority of the public, so that only the very lucky few have used them to become filthy rich!
- THE AWESOME CASH SECRETS OF NEW YORK MULTIMILLIONAIRES REVEALED!!!
- "SPECIAL BANK ACCOUNTS"
- REVEAL TO YOU THE JEALOUSLY GUARDED SECRETS OF THE RICH AND
- GET RICH BY USING THE JEALOUSLY-GUARDED SECRETS OF AMERICAN
MULTIMILLIONAIRES (NEVER BEFORE REVEALED TO THE PUBLIC!)
DISCOVER AND USE THE INSIDERS' SOURCES OF FREE MONEY
USING A POWERFUL MILLIONAIRES' CASH STRATEGY
USE THIS GREAT SECRET MILLIONAIRE'S STRATEGY
THE SECRETS OF THE RICH AND POWERFUL REVEALED!
Think about Rich and Powerful people like Bill Gates, Ron Perelman,
Trump, Stephen Spielberg, Barbara Streisands, Oprah Winfrey, Jeff Bezos of
Amazon.com, Mayasoshi Son of Softbank, Steve Wetherel, Craig MaCaw, Michael
Dell of Dell Computers, Henry Kravis, Sumner Redstone, Ted Turner, Warren
Buffett and George Soros and many others.
Technically speaking, due to the nature of the structure of the Fed and its relation to the banking system, the billions of Dollar bills it prints are really "worthless", because they are created out of the thin air!
YOU CAN OPEN "SPECIAL BANK ACCOUNTS" AND GET RICH WITHOUT ANY HARD
Even though this banking system is little known by the masses, it is a 100% legitimate banking transaction, approved by American Bankers Association, Federal Trade Commission, and US Treasury Service,The Attorney general of the State of New York as well as all International banking institutions.
CAN MAKE ALL YOUR DREAMS COME TRUE!
One-in-a-million, lifetime, mega-monstrous, "le crème de la crème", mother lode cash opportunity.
The jealously-guarded awesome cash secrets of the "Money Elite", New York "Wizards of Wealth", American "Movers and Shakers", and "International Banking Moguls!" can make you rich beyond your wildest imagination! This is a limited offer valid for TWO weeks only. If you order immediately, you can take $50 off and pay only $100.
Entities That May Be Conducting Banking Operations in Canada or the
United States Without Authorization
March 24, 2000
TO: CHIEF EXECUTIVE OFFICER
SUBJECT: Entities That May Be Conducting Banking Operations in Canada or
the United States Without Authorization
The Federal Deposit Insurance Corporation (FDIC) recently became aware that the Office of the Superintendent of Financial Institutions, Province of British Columbia (Canada), issued an order on February 9, 1999, requiring certain entities to cease from either directly or indirectly carrying on deposit business in British Columbia. The order also requires the entities to cease using the words "trust," "deposit," "insurance" and other words in a way likely to deceive or mislead the public about their ability to undertake "trust business," "deposit business," or "insurance business," or to give the false impression that any of the entities are a trust company or an insurance company.
The following entities are covered by the order:
Broadway Financial Group Ltd. (1)
Fidelity Management and Trust Ltd.
First International Bank of Grenada Limited
First International Trust of Grenada
International Depositors' Reinsurance Corporation d/b/a International Deposit Insurance Corporation (2) (3)
Stephen Michael Reynolds
(1) Broadway Financial Group Ltd. is not associated in any manner with
Broadway Financial Corporation, Los Angeles, California, the parent company of Broadway Federal Bank, FSB, a financial institution regulated by the Office of Thrift Supervision.
(2) The International Deposit Insurance Corporation (IDIC) is not
associated in any manner with the Federal Deposit Insurance Corporation (FDIC).
(3) On January 27, 1999, the Nevis Island Administration, Ministry of
Finance and Development, Nevis Financial Services Department, served notice on the International Depositors' Reinsurance Corporation, operating as the International Deposit Insurance Corporation, that all operations and business in Nevis must cease effective immediately. The action was taken after a thorough review by the Ministry of Finance and because the International Depositors' Reinsurance Corporation is not licensed by the Nevis Island Administration to conduct business of any form in or from Nevis.
These entities also may be conducting unauthorized banking transactions in the United States. Any proposed transactions involving these entities
should be viewed with extreme caution.
Any information about these entities should be forwarded to the FDIC's
Special Activities Section, 550 17th Street, NW, Room F-6012, Washington, DC 20429. For your reference, all FDIC Financial Institution Letters published since January of 1995 may be found on the FDIC's Web site at www.fdic.gov under "News, Events & FOIA."
James L. Sexton
Distribution: FDIC-Supervised Banks (Commercial and Savings)
NOTE: Paper copies of FDIC financial institution letters may be obtained
through the FDIC's Public Information Center, 801 17th Street, NW, Room
100, Washington, DC 20434 (800-276-6003 or 202-416-6940).
The web-sites of the Alaska Division of Banking, Securities and
Corporations, (click here) currently contains the following warnings about GIFT and Le Club Prive:|
WARNING! We have word from Montana of a pyramid scheme coming around.
It goes by several names, the one aimed at a Montana woman recently was
The Given In Freedom Trust or G.I.F.T. (You know who the giver is!) The
premise of the scheme involves a classic pyramid recruiting structure (you go recruit three people, they go recruit three people, etc...) with monies being deposited in an off-shore account in the West Indies (Given In Freedom Trust, William A. Hull Business Center, Suite 201, Main Street, Charlestown, Nevis, West Indies.) The fax number listed is (869) 469-0996.
WARNING! Le Club Privé appears to be a huge Ponzi scheme (Click here to
find out more about Ponzi schemes). The operator of the scheme, known as
"Bull Dozer" claims to offer many ways of building wealth, most through
supposed secret offshore trading programs. The money actually comes from the victims. Of course, you must be a member to participate - membership starts at $1,495, plus a monthly fee, and you forfeit your position on the pyramid if you fail to recruit other members or don't send in your monthly obligation. Bull Dozer claims an address in the Netherlands, but the contact phone number is in Oregon. If you know anything about Le Club Privé, please let us know.
THE NEW LE CLUB PRIVE SCAM BUSTER FORUM
Le Club Prive (LCP) Scam Busters is pleased to announce a dedicated
forum for Le Club victims and LCP “Due Diligence” seekers. Additionally we offer an extensive Le Club “DD” web Site that mirrors the secret Le Club back room and hosts the largest Police, Regulatory Agency, and scam related links, ever put together on the Web. Click here.
SEC Halts Fraudulent Internet "Virtual Stock Exchange"
and Freezes Overseas Assets
SECURITIES AND EXCHANGE COMMISSION v. SG LIMITED, d/b/a
STOCKGENERATION et al. (United States District Court for the District
Massachusetts, C.A. No. 00 CV 11141-JLT) (June 9, 2000)|
The Commission announced today the unsealing of a temporary restraining
order and asset freeze issued by the U.S. District Court in Boston
SG Limited, based on allegations that SG operated a massive pyramid
involving the offering of investments in a so-called "virtual company"
the Internet. According to the Commission's allegations, SG Limited,
on the Caribbean island of Dominica, operates a website under the name
"StockGeneration," (www.stockgeneration.com) promising investors a
risk-free, guaranteed return of 10% per month, or 215% per year on a
compounded basis. SG allegedly described itself as a "virtual stock
exchange" offering investments in the stock of several "virtual
including one referred to as the "privileged company" whose shares
rise" and generate the guaranteed 10% monthly return. According to the
Commission, the "exchange" and "companies" are fictional entities that
only for purposes of SG's investment offering. The Commission alleged
the investment program, which raised hundreds of thousands, if not
of dollars was actually nothing more than a classic pyramid scheme. The
Commission further alleged that investors did not receive the
return and have not even been able to recover their initial
According to the Commission's complaint, in fact, in recent weeks, SG
informed investors that their purported guaranteed, risk-free
had been reduced to only pennies on the dollar. The Commission alleges
even while unable to meet its obligations to existing investors, SG
continues to offer its investment program on the StockGeneration
still promising a risk-free guaranteed 10% monthly return.
The Commission's complaint, which was filed on June 9, 2000, alleged
Limited violated the general antifraud and securities registration
provisions of the federal securities laws -- that is, Sections 5(a) and
and 17(a) of the Securities Act of 1933 and Section 10(b) of the
Exchange Act of 1934 and Rule 10b-5 thereunder. The Commission's
also charged as a relief defendant an affiliated company, SG Perfect,
Limited, which was unjustly enriched through the receipt of over $1
of the money raised from the StockGeneration scheme. On June 9, 2000,
U.S. District Court for the District of Massachusetts granted the
Commission's motion for an ex parte order temporarily restraining the
fraudulent activities, freezing the assets of SG and SG Perfect,
the proceeds of the offering, requiring that the funds be returned to
U.S. under control of the Court, and imposing other equitable relief.
obtaining the emergency relief the Commission succeeded in freezing
assets of the defendants overseas. A hearing on the Commission's motion
a preliminary injunction will take place within two weeks. In addition
the emergency relief, the Commission is seeking an order permanently
enjoining SG from violating the antifraud and registration provisions
federal securities laws, requiring SG and SG Perfect to disgorge funds
received through their violations of the securities laws, and imposing
monetary penalties on SG.
The Commission acknowledges the assistance of the Economic Crime
the Central Criminal Police of Estonia.
Investors are advised to read the SEC's "Cyberspace" Alert before
any investment promoted on the Internet. The free publication, which
investors to the telltale signs of online investment fraud, is
the Investor Assistance and Complaints link of the SEC's Home Page on
World Wide Web http://www.sec.gov. It can also be obtained by calling
Investors are also encouraged to report suspicious Internet offerings
other suspicious offerings) via e-mail to email@example.com. A
user-friendly form to assist you in making a report is available at the
Home Page http://www.sec.gov. Investors can also mail a report to the
Enforcement Complaint Center, Mail Stop 8-4, 450 Fifth Street, N.W.,
Washington, D.C. 20549.
Fraud and Scam Warning Site
Called 'Finet', this site from France carries current news and reports about international scams, frauds and swindles. Click here.
New IRS Publication on Sham and Abusive Trusts that are "too good to be
true". Order Publication No. 2193 by calling IRS.
'Nato' scam cons electronics firms
Julian Borger in Washington|
Thursday March 30, 2000
It was trumpeted as a top-secret Nato project that would require truck-loads
of state-of-the-art gadgetry, so - smelling huge orders ahead - some of the
world's best known electronics firms rushed to ship more than £30m worth of
their latest equipment to a clandestine "test-site".
It turns out, however, that the Nato "material tests unit" was no more than
a small flat in the Belgian town of Rekem. Furthermore, the crisply
uniformed US procurements officer going by the name of Lieutenant-Colonel
Lamar Reed, who was supposedly coordinating the project, was a talented
con-artist who hid his pony-tail under his air force cap. He has now
disappeared, along with much of the equipment.
The extraordinary scam fooled some of the biggest names in the business.
During a period of five years, Electronic Data Systems (EDS) Corp, Sony,
Pioneer and Adobe all sent sample computers, videos and other electronic
equipment after signing confidentiality agreements sent to them on
"The beauty of it was that everybody signed non-disclosure agreements so
that no one talked to each other. It was very, very cleverly done," said
Christopher Bailey, the managing director of Techex Ltd, a British firm
which was one of the smaller fish caught up in the scam's net.
Techex sent about £57,000 in video-editing equipment to the "test-site",
hoping that bigger orders would follow. However, the launch of the project -
its exact nature was vague - seemed always to be just around the corner,
postponed again and again because of Kosovo or Iraq and other crises.
Lieut-Col Reed and his team of imposters (it is still unclear how many were
involved) were so sure of themselves that they turned up in full uniform at
the headquarters of Envisage to discuss the project. When Sony grew
suspicious and sent staff to Envisage to investigate, the colonel was there
to meet them in a rented limousine flying Nato flags.
Sony finally sent a private investigator to the "materials test unit" in
Rekem, where he found a cheap, two-bedroom apartment. The Belgian police
raided the flat in December, but the scam's mastermind had gone. His wife
was left behind, apparently unaware of what had been going on.
There is a greater risk of being kidnapped in Colombia than in any other country in the world. More than a dozen U.S. citizens were kidnapped in Colombia in 1999, twice as many as in 1998. Some have been individual incidents and others have involved large group hostage situations. In some cases, the victims have been murdered. Most kidnappings of U.S. citizens in Colombia have been committed by guerrilla groups, including the Revolutionary Armed Forces of Colombia (FARC) and the National Liberation Army (ELN), which were both designated as Foreign Terrorist Organizations by the Secretary of State in October 1997. Since it is U.S. policy not to pay ransom or make other concessions to terrorists, the U.S. government's ability to assist kidnapped U.S. citizens is limited.
The U.S. Securities and Exchange Commission is hiring 60 new "cybercops"
to monitor the Web to attempt to stem what is defined as a new "climate of
Internet lawlessness" The SEC will hire and train as many as 100 enforcement staff people to its existing 850 member enforcement staff. The current staff consists of lawyers and analysts, with 50 to 60 dedicated to combating Internet fraud. For info, go here.
Pure Trust/Constitutional Trust Scams
Attack Upon U.S. Corporate Tax Shelters
By now it should be clear that the United States is dead serious in its
determination to stamp out what it considers abusive tax shelters. This
week, the tax authorities took another step in that direction by issuing three sets of temporary and proposed regulations that require promoters to register confidential corporate tax shelters and to maintain lists of investors.|
In a speech during the annual conference of the Federal Bar Association's
Section of Taxation, last-minute substitute speaker Treasury Secretary
Lawrence H. Summers jumped into the permissible tax planning/impermissible tax avoidance debate by saying: "Let me be clear: Our aim is to curb illegitimate tax avoidance. We have no quarrel with the natural desire of companies and individuals to minimize their tax burden by legitimate means. We must, however, draw the line at the pursuit of engineered transactions that are devoid of economic substance."
Summers announced that during the next six months, Treasury and the IRS will issue updated professional standards that could include limits on contingent fee arrangements, heightened opinion standards, and sanctions on firms that issue opinions on tax shelters. In extreme cases, individuals -- and entire firms -- could be suspended from practice before the IRS.
International Depositors Insurance Corporation
"There have been several questions on the forum about IDIC, which purports to 'insure' several Caribbean banks, including First International Bank of Grenada and Crown Meridian Bank, also of Grenada.|
Just so that everyone knows, IDIC exists only as a piece of paper in an
attorney's drawer and has no physical location or any employees.
An information number is listed on its web-site and this goes to the offices
of Dominica-based attorney Gerald Burton. One of Burton's employees answers
the line with the words "IDIC information". You will be told that IDIC is in
the process of "relocating" its physical address and that this number is
simply an information line. The reality is that IDIC is not relocating
anywhere. It exists as a name only in order to give comfort to easily-leased
suckers who think their bank deposits are insured.
[attribution: David Marchant ]
Beware Of The Global Prosperity Group (GPG). It is claimed that this
program has already claimed over 30,000 victims. It has "Cease And Desist
Orders" in Washington, Oregon and Michigan. Virtually all other states are
currently investigating this modern day pyramid scam. The net is inundated
with GPG SPAM (unsolicited email). Thousands of GPG complaints are on file
at the BBB and Attorney General offices around the United States. www.idir.net/~medintz/downwithgpg/index.html
OFFSHORE FINANCE CANADA offers free access to its exclusive OFC Due Diligence
Directory. Warning notices against companies and financial institutions
carrying on business in the international marketplace are issued from time to time by regulatory authorities around the world.|
Unfortunately, there is no central database which compiles all such warning
notices. Rather, investors are required to contact each regulatory authority
The OFC Due Diligence Directory was recently updated and is now available for consultation online. It contains over 325 warning notices and is accessible
free of charge here.
X-ray scanner that sees through air traveler's clothing
As if U.S. Customs services aren't bad enough at New York's JFK INTERNATIONAL
AIRPORT, now there's an X-ray scanner that sees through air traveler's clothing, projecting your naked body image on a screen, a truly electronic strip search. American Civil Liberties Union [http://www.aclu.org] protests:
'If there is ever a place where a person has a reasonable expectation of privacy, it is under their clothing.' Scanners now installed also in Miami, Atlanta, Los Angeles and Chicago at $125,000 each. Travel hints: wear clean, fashionable, non-threatening underwear. Cash bundles do show up.
[attribution: Associated Press]
Purpose Trusts are NOT for U.S. Persons
The 'purpose trust' is a commercial, non-charitable 'trust' created in
recent years by statute in Bermuda, Barbados, the British Virgin
Islands, Cyprus, Belize, the Cook Islands and the Isle of Man.
Compared to a traditional trust created to benefit named beneficiaries
or to a charitable purpose trust, a commercial purpose trust is
established for a particular business objective. It's been used for
multi-million dollar aircraft and shipbuilding financing transactions,
multi-entity share holding, asset securitization and cross border
The 'charitable purpose trust' has been around for centuries, usually
created to benefit a religious, educational or other non-profit
objective. In such case, while no specific persons are named as
beneficiaries, courts enforce the trust terms so that its benefits are
distributed to promote the stated purpose.
The new business purpose trust often will in turn create a subsidiary
corporation, the parent trust's sole purpose being to hold title
to shares in the new company. Miami asset protection attorney DENIS
KLEINFELD notes: 'The underlying company can serve as part of a
financing package, as a title holding entity or even as a corporate
trustee.' He points out the 'beneficial objects' of a purpose trust
are not people, but the designated commercial purposes.
This arrangement does differ from the usual trust based on common law
and equitable principles. The US-UK common law rule is that for a
valid trust to exist, there must be a person who can enforce the
obligations of the trustee to administer the trust in accordance with
its terms, a notion known as 'the beneficiary principle'. This
requirement is satisfied where the trust is established for a class of
individual beneficiaries. To cover this aspect in commercial purpose
trusts, statutes provide for a 'trust enforcer' who in theory
represents the general group or the public for whose benefit the trust
is created. The Bermuda statute, for example, in the absence of an
enforcer because of death or disability, allows the trustee of a
purpose trust to petition a court to appoint an enforcer.
Because they are relatively new, the commercial purpose trust laws are
'a leap into the legal unknown,' Kleinfeld says. And this new entity
also raises US tax law issues. International tax attorney J. RICHARD
DUKE says: 'A purpose trust almost certainly is 'an association
taxable as a corporation' and not a trust for US federal income tax
purposes. Favorable US tax rules applicable to other trusts simply
cannot be made to apply to purpose trusts.'
Some slick promoters advocate creating an offshore purpose trust that,
in turn, creates an offshore international business corporation (IBC).
They claim this purpose trust arrangement escapes US tax reporting
requirements and avoids the trust being treated as a domestic
corporation for tax purposes. (Under Internal Revenue Code §§
672(f)(1) and (3), a controlled foreign corporation or a passive
foreign investment company cannot form a foreign trust in order to
avoid U. S. taxes).
Duke warns against such tax avoidance schemes, adding: 'A US person
unfortunately is in quick sand if he is caught using a purpose trust
in a misguided attempt to avoid or defer US taxation.'
Denis Kleinfeld, JD
J. Richard Duke, JD
More on business purpose trusts, see: 'Non-charitable purpose trusts
in offshore centers' here.
[attribution: The A-Letter, a periodic Net publication of:
THE SOVEREIGN SOCIETY, here. ]
U.S. IMMIGRATION LAWS (BRIEFLY)
It is unlawful for an employer to employ a foreign national in the United
States without first obtaining work authorization from the U.S. Department
of Justice's Immigration & Naturalization Service (the "INS"). Sanctions
imposed on an employer for violation of this law can include fines,
restrictions on the future hiring of foreign nationals, and imprisonment.
Violations by the employees themselves may result in removal (deportation)
or preclusion from other immigration-related benefits. Clearly, it is in the
best interests of both the employer and employee to comply with the
immigration laws. [attribution: ABA Immigration & Nationality Committee Newsletter]|
OPC International offshore scams alert site
Siemens German digital signature chip hacked
Hackers have succeeded in cracking the Siemens digital
signature card used in cashless payment systems and access
control systems across the country. The German Digital
Signature was ratified by the European Union only a few
days ago, after intense lobbying for a secure system for
transactions. The serious breach of security means that
anyone using the so-called Geldkarte system stands the
risk of having money transferred without their knowing it. Click here.
UNITED KINGDOM PASSES “DRACONIAN” TAX FRAUD LEGISLATION
The United Kingdom has recently passed legislation aimed at tax evasion by
Her Majesty’s subjects, which is being hailed as “draconian” by the London
While it is too early to tell, it appears that some parts of the new act
will be used to put additional pressure on the British protectorates in
Europe and the Caribbean to put a damper on the promotion of so-called
“fiscal crimes”, as tax evasion is known there.
In past months, we have noted the tightening noose around the British
overseas territories (including the Caymans, BVI and Bermuda, as well as the
European bastions of Gibraltar and the Channel Islands) to the extent they
promote tax evasive activities in those jurisdictions. I now predict that
the year 2000 will “tell the tale” of the continued viability of these
jurisdictions as true offshore financial centres.
[attribution: Adkisson Analysis ]
A trend of a new scam is emerging in Eastern Europe. It has hit many central and eastern European banks and will probably spread from there. Here is the scenario. Cash is converted to stock or bonds. The negotiable and quality bearer bonds or stock is left with Bank A and Bank A issues a safe keeping receipt. The safe keep receipt is offered to Bank B as collateral for a loan to borrow up to 50% of the face or market value of the bonds. Loans are typically 12 months or more.|
The loan is defaulted on and Bank B forecloses on the bonds or stock which
is evidenced by the safekeeping receipt issued by Bank A.
Query: The Bonds or stock held by Bank A are---choose one of the following:
C. Were good bonds/stock but were reported missing by the owner and
certificates held by Bank A have been cancelled and replaced.
D. (RARE ANSWER) Are real, but the two banks have just aided in
laundering money and transferring money from one location to another.
The correct answer to this new scam is that choice D is becoming more
prevalent, replacing the A, B and C choices.
Most foreign visitors to Russia use ATM's to get their cash.
Even that system has now been breached in the corrupt Russian banking
system. High tech thieves have been obtaining credit card PINs from corrupt
bank employees when foreign visitors use their ATM cards in Moscow. By
creating counterfeit ATM cards, they have been clearing out the foreign
bank accounts---up to their limits---of the victims through the Visa and
Europay systems. An American working in Moscow recently lost $2,300 to this
fraud. Withdrawals are taking place outside of Russia, including the U.S. and
Western Europe, making capture of the thieves quite difficult.
1st American Legal Corporation
This company has an excellent, informative site which exposes common scams and financial traps. These include such scams as: Anti-IRS Theories, Bank Debentures, Constitutional Trusts & Pure Trusts, Diplomatic Titles & Titles of Nobility, Great Nigerian Scam, Hiding Money Offshore, Unsecured Offshore Credit Cards, Private Offshore Banks, Private Insurance Companies, and Self-Liquidating Loans.|
It also covers the following financial traps: Alaska Trusts & Delaware Trusts, Annuity Abuse, Black Holes & UFOs, Commissions & Loads, Life Insurance to Pay Estate Taxes , and Living Trusts.
They also keep tabs on certain questionable groups, such as the so-called Dominion of Melchizedek, Global Prosperity Group, and the Marc Harris Organisation.
Click here to visit the site.
An investigation, code named Operation Risky Business, began in October 1994 and was conducted out of the Custom Service's Office of Investigation in Tallahassee, Florida in conjunction with the Federal Bureau of Investigation. The investigation centered on the illegal defrauding of money and the money laundering activity of suspects involved in an international venture capital loan scam. |
The Customs Service has thus far been able to identify a minimum estimate of millions of dollars that have been fraudulently gotten from hundreds of victims from at least 10 countries around the world.
Operation Risky Business centered on the efforts of a vast network of suspects who defrauded victims through an international venture capital loan scam which was specifically designed never to provide a single dollar to victims seeking the loans.
Execution of the scam generally involved seven steps:
By the time this entire process was done, generally over a period of months, victims may have paid the scammers anywhere from one to as many as a half-dozen payments approaching as much as $2 million. At the same time the scammers put the victims in a position where the scammers, and the victims themselves, viewed the victims as the people not upholding their
portion of a "legal" contract. Thus, the victims were willing to pay additional fees in an attempt to not lose their original "processing fee."
- A broad network of associates involved in the international venture capital loan scam, numbering as many as several hundred throughout the world, placed advertisements in newspapers like USA TODAY, The Wall Street Journal, Barons, The New York Times, The Robb Report, The International Herald Tribune and other newspapers, offering investment and venture capital loans.
- Unknowing victims from throughout the United States as well as Singapore, Israel, Turkey, Australia, Greece, France, the British Virgin Islands, Canada and the United Kingdom would respond to these ads seeking legitimate investment and venture capital loans to start new businesses or expand existing ones.
- The victims would often be screened and interviewed by first level "brokers" (members of the scamming network) to determine the needs of the victims, their accessibility to funds required to pay the scammers' "processing fee" and to put on the image of a legitimate business enterprise.
- The victims then often speak with second level "brokers" (members of the scamming network) to determine the victims' ability to pay a "venture capital loan processing fee" necessary to initiate all activities involved in making the venture capital loan. This determination was accomplished by the victims providing photocopies of actual cashier's checks in the amount of the "fee," which the second level "brokers" would verify with the bank involved. The "fee" amount would vary from victim to victim. It would be determined by the "brokers" "sizing up" the victim and estimating the maximum amount of money the victim could pay as the "fee." This "fee" could range from $40,000 to $2 million.
- The victims then often speak with a person known as a "syndicator" (a member of the scamming network). It was the "syndicator's" job to close the deal. They would discuss the needs of the victims and the requirements of the venture capital loan organization and its non-existent "board of investors" who purportedly provide the actual venture capital funds. The "syndicator" would ultimately provide a contract to the victims which purported to provide the victims with the venture capital they needed and also outlined the victims' need to pay in advance the "processing fee" associated with the transaction. The victims would then pay the "processing fee" and sign the contract. The contract included a critical element which made the entire scam possible, a clause which required the victim to obtain,
generally within five to seven days, a letter of credit or bank payment guarantee of $2 million to $20 million or more, to act as a guarantee to the "board of investors" that the venture capital loan amount would eventually be repaid. The scam lies in the fact that no bank would ever provide such a letter of credit or bank payment guarantee without a matching amount of collateral -- which virtually none of the victims had. If they had that kind of money for purposes of collateral, they generally would have no need for a venture capital loan in the first place.
- The victims then return to their "syndicators" at the end of the five to seven days and inform the "syndicator" of their failure to get the required letter of credit or bank payment guarantee, in some case after contacting dozens of banks. The "syndicator" would explain how the victims had not upheld their end of the signed "legal" contract and that the "processing fee" would now be forfeited to the venture capital loan organization to cover their expenses.
- Many victims were often then told by the "syndicator" that the "syndicator" could assist the victims in an effort to help them avoid losing their "processing fee." The "syndicator" would then introduce the victims to individuals known as "facilitators" and "underwriters" (members of the scamming network). The "facilitator" would purport to assist the victims in getting their necessary letter of credit or bank payment guarantee -- for an additional in advance fee -- often $10,000 to $35,000. The "underwriter" would work in concert with the "facilitators" and would purport to assist in the sale of off-shore stocks -- for yet another in advance fee -- often $1,800 to $10,000, to repay the venture capital loans in one year.
Unknown to the victims, there was never any money to provide as venture capital. All the fees collected by the scammers were distributed in percentages to the participants involved with that particular victim.
The money scammed from the innocent victims went to two offshore banks on the Caribbean Island of Antigua. One of these banks is owned by the scammers themselves. Antigua was chosen by the scammers because of its reputation as a tax haven and bank secrecy country, as well as because of relationships the scammers had with the government officials in Antigua. The scammers' bank was chartered in September 1994 by several of the suspects.
With all the fees paid by the victims going to and through a foreign bank, it made it impossible for the victims to take any meaningful legal action to retrieve the funds in the event they even tried. The fact that these same moneys were moved from the United States to a foreign bank, then returned to the United States for payment to the scammers, represents illegal money laundering.
SOURCE: U.S. Customs Service
Internet ScamBusters! is an e-zine which exposes scams being perpetrated over the Internet and consequently affect both the domestic and international cyber-arenas.|
You Can't Know Too Much About Scams!
This is a reprint of an article written by Arnold L. Cornez, J.D. which appeared in the November/December 97 issue of "The ISPI Privacy Reporter".|
Email and the Internet have opened new flood gates for scam artists, hucksters and checkered people. As Editor of OFFSHORE, an eJournal (a monthly, on the Net, for info, email to firstname.lastname@example.org). I have seen the rebirth of most scams bedecked in new covers -- pyramid schemes, Ponzi schemes, chain letters and just plain vanilla consumer ripoffs.
Before we get started you should know that almost weekly, I am asked for my opinion on so and so's book and theories, such and such an investment program, this or that person or company, etc. But, I'm afraid to answer these questions in open forum... lawsuits for defamation (liable or slander) in this overly-litigious U.S. society terrify me. So, I candidly tell my readers just that. I do, however, answer such inquiries for clients, but then only on a very confidential -- for your eyes only -- non-public basis.
The purpose of this article, then, is not to name names as if we were the "Offshore Consumer Report", but rather to give ISPI readers a basic understanding of what I consider some of the most commm Offshore scams.
The "Buy A Private Offshore Bank Scam"(c)1997, 1998, Arnold L. Cornez, J.D., all rights reserved.
In my view, spending $25 - $70 thousand on an offshore private bank is foolhardy for MOST people. For all but the astute and educated financier, they seldom make a useful business vehicle.
The promoters of offshore bank schemes claim they offer two primary advantages: the first is privacy, and the second is the ability of the offshore bank to accumulate (undistributed) profits without those profits being subject to US tax via its US shareholders (an exception to the traditional for profit corporation which is still taxed on accumulated but undistributed earnings).
Many buyers have been convinced by promoters that they need a private bank for marshaling assets for various ventures or pooling funds for investing. But, quite frankly, that is hog-wash. There are better and much less expensive vehicles for doing the same thing.
In most cases the sale of private banks to ordinary offshore investors is a consumer ripoff. Some hucksters are buying so called "banking licenses" in obscure and untested jurisdictions in bulk for around $2,500 each and then selling them to unsuspecting offshore newbies for upwards of $70,000. Many of the South Pacific tax havens -- a major source of private banking "licenses" -- are close to being insolvent. A fact that few promoters discuss with their clients. These jurisdictions stay "afloat" only because of generous financial support from other nations such as New Zealand and Australia. When they eventually do go bankrupt, where will that leave Mr. and Mrs. Offshore Newbie and their private South Pacific taxhaven bank?
Another problem with these licenses is that they may not be assignable or transferable without the consent of the tax haven -- a minor fact often overlooked and not disclosed by the promoters who sell to unsuspecting customers. In many situations the promoter sells it and says "Good Bye!" to the customer leaving the buyers to fend for themselves.
Operating an offshore bank so as to qualify for the special status offered under both Canadian and US tax laws means actually operating a banking institution... this is not a learn as you go endeavor. If someone wants to sell you an offshore bank ask him this: who will run it?
The "Cookie Cutter" Trusts Scam:
In contrast to the claims of various multilevel marketing (MLM) schemes that mass market "off-the-shelf" or "boiler plate" offshore trusts, there is no such thing as a good "one-size-fits-all" trust agreement. Yes they appear to be inexpensive, but, in my opinion they amount to nothing more than scratch paper.
An offshore trust (APT) must be customizcd for you and your family. The IRS and Revenue Canada have imposed so many reporting requirements on the APT, that to be tax compliant, you could spend hours just preparing tbe necessary forms. With these disclosure forms there is no longer any privacy with the APT. It is only good for asset protection.
And, contrary to what you may hear at that MLM "business briefing" or on that telephone "conference call" with tbe "Betty Crocker" of cookie cutter trusts herself, used alone, a trust does not provide any avenue for legal tax avoidance.
While we are on the topic of trusts, avoid the "grass roots" activists. You will know these folks by the terms they throw around, such as: pure trust, constitutional trust, sovereign citizenship, etc. Even if they have a constitutional leg to stand on, all that getting involved with them will get you is a file at the IRS or Revenue Canada labeled "Tax
Protester ... audit often".
Fast Wealth For Little Investment Scam:
"Unbelievable Rates of Return" usually aren't believable. You know the old saw, if it sounds too-good-to-be-true, then it probably is. Don't let down your normal, protective safe-guards for the allure and romance of offshore investing. There is nothing magic about going offshore. High returns come with high risks. Claims of impossible returns mean the likely loss of your investment.
Avoid anything to do with prime bank notes or guarantees, the "world's top 100 banks", the roll program. ete. These all have the get-rich-quick allure, but, they are usually "Catch 22" programs designed to rip you off. Yes there may be Prime Bank Notes but if there are, they are for the $100 million dollar crowd. That lets me out -- how about you?
The Nigeria Scam:
Nigeria is the least respected business community worldwide. Don't do any business with Nigeria. Don't even answer that first fax to share in "secret" misplaced governmental money. The scam has been around longer than Rip van Winkle and continues to lure the suckers who are driven by greed to letting down their safeguards. For more information on this scam, go here.
Here is the form of a fax or letter you could receive:
urgent and confidential business proposal
More information on the Nigeria scam is available here.
I am Mariam XXXXXX (Mrs.), widow of the late Col. Bello XXXXXX, the
former Governor of Kano State of Nigeria. My late husband was one of the
victims of the November 17th, 1996 Nigerian A.D.C. Aircraft Boeing 722 that crashed in Lagos.
I have just been informed by our legal attorney Barrister Samuel Okum of
Samuel Okum & Associates that my late husband operated a secret account
with fictitious name in a Nigerian Bank into which a total sum of Twenty Nine Million, Five Hundred Thousand U. S. Dollars ($29.5M) was transferred and credited in his favour and stated me as next of kin. The attorney now advised me to seek in confidence a foreign account unto which this fund could be transferred for disbursement as directed by my late husband in his will.
It has been resolved that 2% will be your share for nominating an
account for this purpose and any other assistance you will give in that regards. 5% has been mapped out to pay back all local and international expenses which may be incurred in the transfer process and 5% has been conceded to the local bank manager here assisting in facilitating the transfer.
Finally, 70% will accrue to my family and I, from where our attorney’s
bill will be settled. A good part of this fund shall be directed towards
executing his will which is to buy shares and stocks in foreign country
to secure his children’s future to facilitate the conclusion of this
transaction, if accepted, do contact our family attorney through E-mail:
email@example.com for further information on the way forward.
Please, note that I have been assured that the transaction will be
concluded in ten (10) bank working days upon commencement by our family attorney, so endeavour to contact him immediately.
May I at this point emphasize the high level of confidentiality which
this business demands and hope you will not betray the trust and confidence which I repose in you. However, you may need to give me sufficient assurance that you will not sit on this fund when it is finally remitted into your account.
Please, give this proposal a prompt response as the condition in Nigeria
now is favourable for the transfer to be made since we have a new government in place.
Arnold L. Cornez, J.D. is a member of ISPI's Board of Advisors. He is an international financial consultant and principal associate of tbe Nassau based The Global Group Limited. His critically acclaimed book The Offshore Money Book is available through ISPI for US$29.95 + $5.00 S&H. You may contact Mr. Cornez at his Menlo Park, California office by phone: (650) 324-6888; Fax: (650) 854-9123; or e-mail: firstname.lastname@example.org.
What to do if you've been scammed
If you’ve been conned by a scamster, you can file complaints with
the following, all of whom offer free information and assistance:|
- Your state attorney general; you’ll find the address and telephone number in your phone book.
- The Federal Trade Commission, Telemarketing Fraud, Room 200, 6th St. and Pennsylvania Ave. NW, Washington, D.C. 20580. For a booklet that lists your rights, call the FTC at
- The National Fraud Information Center, a private nonprofit organization, has a form you
can fill out and submit online for telemarketing and Internet consumer problems. You can
also try calling 800-876-7060.
- Check out Call for Action, a Washington, D.C.-based network of consumer hotlines:
301-537-8260. Call for Action has consumer counselors who can help route your complaint through the proper channels.
Don't be a sucker for scams|
How to recognize a well-versed scamster
By Marshall Loeb, CBS MarketWatch
NEW YORK (CBS.MW) -- They're b-a-a-a-ck. The scam artists are out again in force -- those unscrupulous con men, crooks and assorted low-lifes who are trying all sorts of phony stock deals, common frauds and other tricks to separate you from your hard-earned money.
"Make no mistake:
Many con men are masters at making their phony investments ... sound real."
Watch out for hard-selling types who cold-call you at home or
knock on your door during dinner to whet your appetite for raw investments. Beware also of
those who dangle fly-by night schemes that they vow can't miss. If an unknown
salesperson phones and pitches a stock to you, you're smart to hang up -- you've
got better things to chew on. At minimum, ask him to call back tomorrow and outline his
plan to your banker or financial planner.
Be particularly cautious of someone who refuses to provide references from his present
customers or a warranty for a hard product he or she is selling. Be suspicious of any
seller who says you have to make up your mind and send in your money very fast. Ask for at
least 24 hours to contemplate the purchase or investment.
Easy to fall
You probably think you'd never fall for this one: A smooth-talking salesman urges
you over the phone to grab a once-in-a-lifetime chance to invest $10,000 in a gold mine,
with a promise to let you buy the gold at two-thirds the market price. You're too
smart to be taken in by that obviously phony pitch, right?
Well, don't be too sure. Scamsters rob Americans of about $40 billion a year, says
the Alliance Against Fraud in Telemarketing. Money magazine has estimated that stock fraud
alone costs investors as much as $10 billion a year.
The victims aren't all ignorant suckers either. A study for the American Association of Retired Persons finds that people
who lose money in scams -- from hollow investments to phony job opportunities, fake prizes
to home-repair cons -- tend to be more affluent and better educated than average.
While anybody can be a victim, scamsters particularly love to prey on older
folks. People over 65 make up 11 percent of the U.S. population, but they constitute 30
percent of the victims of consumer fraud. Maybe that's because, as an study AARP
says, older people are quicker to believe promises and slower to take steps to protect
their legal rights than the population as a whole.
So, you could indeed be targeted by a con man -- usually by phone, but sometimes by
mail or by messages in computer chat rooms and e-mail. And unless you know how to detect
and deal with the flimflam artists, you could easily become a victim.
Make no mistake: Many con men are masters at making their phony investments -- or
supposedly infallible stock-picking skills -- sound real. For example, a broker might try
to persuade you to invest $1,000 or so in penny stocks -- shares of a firm with an obscure
name that trade for less than a dollar each -- so that he can prove to you that his
recommendations will make you money.
Sure enough, the stock soars in a few weeks. The broker then calls back and urges you
to put, say, $10,000 in a second stock. You bite, and the stock plunges. Why? Because the
broker has dumped his shares, driving the price down, just as he pushed the first
stock's price up. Trouble is, you invested 10 times as much money in the losing stock
as in the winner.
Or consider this often-successful ploy: A polite, well-spoken caller tells you that he
doesn't want your money -- only a chance to prove his stock-picking talents. As
evidence, he assures you that according to his research, the stock of XYZ Corp. will rise
by the end of the week. Sure enough, by Friday the price is up. He calls early the
following week and forecasts that UVW Co.'s stock will fall by Friday. Again,
he's right. After a couple more weeks of accurate predictions, could you become so
confident in his skills that you would be willing to have him invest your money? If so,
say goodbye to your hard-won cash, for you would have fallen for the aptly named
What you don't know is that the forecaster has made hundreds of calls, telling
half the people that XYZ stock will go up and the other half that it will go down. His
second calls go only to the people who got the correct prediction. He keeps doing this for
a couple more weeks. By then, only a fraction of his targets are left. But if 30 investors
give him $15,000 each, the con artist can disappear with $450,000. Not bad pay for a
Other popular scams offer unwary investors shares in partnerships that operate 900
telephone numbers (the ones that typically charge $5 a minute or $25 a call); federal
licenses to operate paging services, mobile radio systems and wireless cable-TV shows;
phony medical devices to treat arthritis and other painful illnesses; and, most brazenly
of all, offers to recoup the victim's losses from past scams -- for a fat fee.
Marshall Loeb, former editor of Fortune,
Money, and The Columbia Journalism Review, writes "Your Dollars" exclusively for CBS MarketWatch.
Trust Scam Bulletin Board
Round One -- Harris vs. Marchant
Offshore Alert and its reporter David Marchant have prevailed in a lawsuit brought by the Marc Harris Organization for libel and slander. The U.S. District Judge who heard the case essentially found that Offshore Alert's allegations that the Marc Harris Organization engaged in shoddy accounting practices and improper commingling of client assets, and in
promoting U.S. citizens to commit tax evasion, were true. Download the Court's Judgment in Adobe PDF format by clicking here.
How to Go to Jail for Tax Evasion
Financing Your Way to Freedom|
From the Internet, source protected
One of the pressing "problems" of those with money offshore, is
to find a way to bring it home - with no tax liability. In most
cases, accruing capital offshore is not a taxable event until
you repatriate the funds - and hence the need to have a strategy
for when you want to do that.
One novel way is to arrange for yourself to "borrow" money from
an offshore bank. Now, we all know that if you borrow money, you
don't owe any tax on that. In fact, if the money is for business
purposes, then the interest you pay on such a loan is very likely
a tax deductible item - reducing your tax, rather than increasing
So what you need is a way to convert your offshore money into a
loan, that you raise for business "expansion".
And here is one way of doing it. Firstly you need to have the
funds already offshore - preferably secure in a corporate account
that is structured in a such a way as to be "independent" of you.
You now arrange a loan from an offshore bank, using the funds
in the corporate account as collateral. The bank will expect
these funds to be "blocked" accordingly.
Naturally, you'll have to pay interest on this loan - but the
true interest rate will be the difference between what you already
receive on your deposited funds - and the rate on the monies
borrowed. This is called the "spread" between what a bank will
pay for your money - and what they will charge you to borrow
This will vary according to which bank you deal with, but for
illustration purposes, let's say the spread is 1.5%. So, the
effective interest rate on your loan is 1.5%PA.
In return for this modest cost, you get to claim the full going
loan rate as a tax deductible item - which more than compensates
for the 1.5% you are actually paying. And what's more, seeing as
you are in reality borrowing funds secured by your own money, the
funds so received are tax free (because it's a loan) as opposed
to taxable (if you had brought in the funds in the normal way).
To make this look up front, you would need to arrange for a
reputable offshore bank to lend you the money - and you would
need to ensure that the collateral funds source was not directly
linkable to yourself. Then, with proper loan documentation in
hand you can draw down on your "loan" for whatever purposes you
This is just one more way that an IBC (properly structured) can
provide you with innovative ways to keep more of what is
The rise of Internet fraud is fostering close working relationships between law enforcement agencies unlike any ever seen before, says FTC Commissioner Jodie Bernstein. The FTC is in the midst of a "Catch the Bandit in Your Mailbox" crackdown on mail fraud and fraudulent Internet marketers. Consumers can go online to file complaints about fraud through the FTC's program. For more information on the FTC's Bandit program, you can visit their website by clicking here.
Grenada has had more than its share of recent scams and scandals causing some to characterize the jurisdiction as being corrupt. As evidence of this, investigate the reports of the First International Bank of Grenada scandal, where the bank was capitalized by an alleged multi-million dollar "precious" stone and their offering guaranteed investments with astronomically high rates of returns. In spite of numerous inquiries to
the Grenada bank regulators, they gave the bank an unqualified approval.